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Under long-established election–of–remedies law in Kentucky, a current or former employee seeking recovery for an alleged violation of the Kentucky Civil Rights Act had to choose whether to pursue a claim through the administrative system, e.g., the Kentucky Commission on Human Rights (“Commission”), or in a state court of law. Until recently, those who chose to pursue charges of discrimination to a final determination before the Commission were not able to file a lawsuit against the employer on the same claim in state court if they did not like the Commission’s decision. The Kentucky Supreme Court has now decided to overrule that precedent and allow employees to get “two bites” by filing a Charge of Discrimination and then, if that is not agreeable, to sue in court.

Janet Owen had been employed as a nursing–care technician at the University of Kentucky's Chandler Medical Center (“UK”). She was discharged in March 2009 and then filed a complaint with the Kentucky Commission Human Rights complaining that she had been discharged because of a physical disability and other health issues. The Commission subsequently decided that Owen’s claim should be dismissed. The Order stated that it was a "final appealable order" but also allowed Owen to seek reconsideration by the Commission if she requested it within 10 days of receiving the dismissal. Owen did seek reconsideration and a new investigation began and additional discovery was taken. Eventually, however, the Commission reaffirmed the dismissal in another final and appealable order, which gave Owen 30 days to appeal in state court.

Owen decided not to appeal the Commission’s Order. At or about the same time, the Equal Employment Opportunity Commission also issued a Dismissal and Notice of Rights, adopting the findings of the Commission. Consistent with federal rules and laws, Owen was informed that she had the right to sue under federal law, either in state court or federal court. Instead of pursuing her federal claim or seeking judicial review of the Commission’s final order, Owen filed an original action in state court under the Kentucky Civil Rights Act (“KCRA”). The Complaint’s allegations were identical to the issues Owen had raised before the Kentucky and federal commissions.

After conducting nearly two years of discovery in the state court action, UK filed for summary judgment (dismissal without a trial) based on well-settled law that KRS 344.270 required an "election of remedies," i.e., that because Owen had first decided to pursue her claims through the administrative process before the Commission, she was barred from litigating the same claims in state court. The trial court agreed and granted summary judgment. On appeal, the Kentucky Court of Appeals affirmed summary judgment on the same basis. The Kentucky Supreme Court granted discretionary review and reversed the courts below, thereby now forcing employers to defend themselves multiple times against the same claims of discrimination.

The Kentucky Supreme Court focused on changes made to the KCRA when the Kentucky General Assembly amended it in 1996. By adding certain words to the statute, the Kentucky Supreme Court concluded that the Legislature meant what it said -- even where it "creates an odd result." The Court is troubled by this but feels bound by law. “We realize the procedural mess created by today’s ruling. Ensuring a preclusive effect to all final determinations resolved under this statutory structure is a logical and practical way for balancing the desire to protect the citizens of the Commonwealth from invidious discrimination while also seeking to impose judicially manageable standards for processing those varieties of claims. Under the statute as currently written, the General Assembly seems to have created the ability of civil-rights claimants to force defendants to fight this battle on multiple fronts. And even more baffling, although the statute as written allows litigants whose claims fail at the administrative level a fresh start in trial court, it expressly precludes the opposite. This structure will most certainly result in every prospective civil-rights plaintiff filing a claim with the agency – with the ability to take advantage of the more-deferential standard of review we afford to administrative rulings should she prevail – and then proceeding to courts of law if the agency determines her claim has no merit.” The Court concluded that "there is no way for us to intervene without usurping the legislature’s sole prerogative to make law.”

Consequently, Kentucky plaintiffs can now file an administrative action before state commissions and then file an original action in state court to litigate the very same claims in order to achieve a more favorable result. Until the Kentucky Legislature revises the statute to prohibit this, employers may have to defend themselves several times in order to prevail against discrimination claims filed by former or current employees.

Phil is a partner and former co-chair of the Labor and Employment Department. He represents employers in defending against employment-related claims in both federal and state courts. He represents clients involving covenants not ...